Episode 10 - Maximizing Property Potential: A Deep Dive with Adam Mayberry
Welcome to another insightful episode of The Breakthrough Podcast! I'm your host, Stephen Husted, and today we have a special guest, Adam Mayberry. We explore the impact of tech on drafting, discuss streamlining authorization, and uncover the future of the industry. Adam shares insights on hiring professionals for property development, navigating city budgets, and the intricacies of the San Jose permit approval process.
Takeaway 01: Embrace Technology in Project Management: Utilize technological advancements for efficient drafting and design. Streamline project management processes for better outcomes.
Takeaway 02: Professional Expertise Matters: Hire professionals for property development to save time and ensure compliance with rules and regulations.
Takeaway 03: Community Impact of Developments: Recognize the initial disruptions of new constructions. Understand the long-term benefits and positive impact on community members. Stay ahead of the game in your projects by incorporating the latest technology, tapping into professional insights, and acknowledging the enduring positive impact developments can have on communities.
TRANSCRIPT
∎ Podcast Intro:
[Stephen Husted] (0:00 - 2:22)
Welcome to The Breakthrough with Stephen Husted, the show that takes you behind the scenes with successful entrepreneurs, real estate investors, and other movers and shakers in the business world. In each episode, we'll sit down with our guests to explore their personal and professional journeys, including the challenges they faced, the breakthrough moments that propelled them to success, and the strategies and the tactics they used to get there. Get inspired by new ideas and strategies and get to know our guests on a deeper level.
Join us for candid conversations, powerful insights, and plenty of breakthrough moments. Please help us grow by subscribing and sharing the podcast, and welcome to the show.
∎ Guest Introduction:
Welcome back to The Breakthrough Podcast with Stephen Husted. Today, we've got Adam Mayberry, the mind behind the Mayberry Workshop. Today's episode is a journey into the heart of property development, where Adam and I peel back the layers of what it truly means to maximize the potential of your space. We're talking innovation, we're talking strategy, and we're not shying away from the controversies that come with it.
Adam and I get real about property value, no fluff, just stories. Ever wondered how your property could be a goldmine? Adam and I dive into the distinctive strategies of Mayberry Workshop, unveiling how we transform properties into hidden treasures.
Buckle up, hit play, and join the conversation with Adam Mayberry on The Breakthrough Podcast.
∎ Podcast Proper:
Adam, I appreciate you coming on. I know we've been playing back and forth for a couple weeks, but I think we've talked about... I know that I've told you that I wanted to get you on the podcast because a couple years ago, I met you at that investor meetup. You were discussing doing ADUs, and that was becoming a really popular thing in California. From where I'm at in San Jose, it was definitely the buzzword.
People were talking about it. I met you there, and we've been in contact this whole time. We've talked about projects.
It hasn't worked out yet. I think partly the reason why it hasn't is just these timelines with the city of San Jose are absolutely nuts and costly.
[Adam Mayberry] (2:24 - 2:48)
Yeah. If you're a turn and burn investor, it's hard to think about that carry cost for sure. Yeah.
We talked through... I think it was the mastermind or small investor meetup. It was probably five years ago or so.
[Stephen Husted] (2:48 - 2:49)
Was it really that long ago?
[Adam Mayberry] (2:49 - 3:01)
Oh my gosh. Because I know I still live in San Jose. I live in Davis, California now, but that was 2019 at least.
It might've been 18 or 19, which is about four or five years ago now.
[Stephen Husted] (3:01 - 3:05)
Wow. Time goes by. I can't believe that.
I thought it was a couple of years ago.
[Adam Mayberry] (3:05 - 3:10)
Yeah. COVID, we definitely had a couple of years vanish from us.
[Stephen Husted] (3:10 - 3:25)
That's true. Our lost years. You're up in Davis now, currently.
Where are you doing most of your work? Where is it all based out of? Is it mostly in Silicon Valley?
[Adam Mayberry] (3:26 - 4:29)
A lot of our work is... We say Bay Area, and now we're saying Northern California. We have a builder partner that's in the Bay Area, in the San Jose area.
We have home base there when I'm there working. We don't have any people working out of that office yet, but we did have a larger office in downtown. I think with work from home and all that, it didn't make sense financially to keep a large office.
I moved my family up to Davis and we have an office here now for people to come to if they need to, but we will go Gilroy to Napa, Sonoma County, Sacramento, East Bay, West Bay, North Bay, South Bay. If we need to go to Central Valley, Central Coast, Wine Country, or San Luis Obispo, that's where I went to school. I'll run down there if I need to.
What about Santa Cruz? Santa Cruz, Aptos. We're doing work in Santa Cruz, Aptos right now too.
[Stephen Husted] (4:32 - 5:05)
So why don't you give a little breakdown of what you're into and what you do? What are the types of developments you've been doing and what's your bread and butter? I know you from the very beginning doing ADUs, which is an accessory dwelling unit.
Basically, if you have a single family home and you have a detached garage, you can build an ADU and basically have it for another rental or a family member. What are you doing and what are people in California looking to do at this point?
[Adam Mayberry] (5:07 - 10:05)
That's a big question. Our practice as an architect has really always been geared towards development. I have a background.
I have a master's degree in how to do development as an architect. I've really used that as a value add to my clients. My first wood frame project I designed and permitted was a duplex that I developed with a partner of mine in San Jose.
That was about the same time ADUs were coming on board and I split off from the firm I was working at, Studio Current, which is also an architect development practice. Jeff Current, I worked with him at Swenson. He's a builder developer.
They have architecture. I have that background, but ADUs were being streamlined simultaneously by the city of San Jose and the state. San Jose did want to make ADUs easier because they knew that was an entry level to adding housing.
The state similarly was pushing for deregulation of ADUs. My involvement with the city of San Jose from a planning zoning perspective and rulemaking perspective, I know those people that do large multifamily towers and stuff downtown because we were working on entitlements or feasibilities on those projects. They're the ones making the rules for the ADU laws.
I was brought in as a stakeholder. I knew on the ground floor some of these rules and really got into understanding state law and how it was changing. Those type of projects, they have zoning requirements, which most smaller designer people doing these smaller projects aren't used to that amount of bureaucracy and legislation that goes around the ordinances.
They are developments for a homeowner. It's different than a flip or a renovation where you're like, I want to move a wall and I want to pick out some finishes, but permitting is fairly easy. When you get an ADU, you have zoning criteria, fire separation, height, bulk, mass, design criteria, full foundation, full utility hookups.
All these things have to go with a large development. I really cut my teeth on designing and feasibilities of developments like Santana Row. When you think of vertical and horizontal spatial arrangement, if you ever walk around Santana Row, you see you got some storefronts.
You also have multifamily entrances on multiple sides. You have parking garages in some of those buildings. You have garage pickup for all the retail and the housing there.
There's four or five, even eight entry points on a building that have to go horizontally and vertically. It's this really complex piece fitting together. It really is.
It's really complex. I designed a couple of those developments out in Somerville, Nevada, where Red Rock is a huge big development out in that area, in Colorado, and one other one early on by the same architects that did the Santana Row. I really understood how to create space and scale.
Using that to find loopholes but have advantages for my clients has been a big benefit to us as a practice of having an edge and for our clients that trusted us to go through the process. Like you say, in the city of San Jose, timelines are tough. They are probably, if you want to say, ADUs and SB9s, they're probably one of the most aggressive from allowing the ADUs and the speed.
What is the speed like?
[Stephen Husted] (10:07 - 10:23)
Let's say a homeowner is listening to this right now and they want to build an ADU. What can they expect if they went through one of the pre-determined packages? Are there different types of floor plans you can pick from that are a little bit faster to get built?
Is that correct?
[Adam Mayberry] (10:25 - 11:15)
Yes. San Jose has a great system there. It's an open market.
Anyone that would qualify for the program can have their floor plan available. We've helped them create that so that there's not an advantage to people with the city giving them away for free. As an architect, we have a free for service.
They're basically saying, your service is free. We've controlled those plans. We do let the design and delivery model speak for itself.
With the pre-approved plans, we have three of them currently. We also have flexible floor plans that we're thinking about getting permitted there, which would expand it to 48 different units if we get that approved.
[Stephen Husted] (11:16 - 11:18)
40 different floor plans?
[Adam Mayberry] (11:20 - 11:31)
It's different sizes. Studio, one-bedroom, and two-bedroom. That's a flexible size so you can get bigger or smaller depending on how much you can fit on your property.
[Stephen Husted] (11:32 - 11:49)
So that's a whole other topic right there, right? But we should get into that part as well because it's curious. Some people just don't know what they can actually fit on their lot because every lot is obviously a different size and shape.
[Adam Mayberry] (11:51 - 13:05)
So our floor plans at the city of San Jose, we have a 532 square foot one-bedroom. We like to say that's our minimum viable product for a nice livable unit, rentable couple. I don't know about young family in there, but a single person or a couple or a grandma or a son or daughter that just graduated from college and wants to move back home but have their own place.
It's a great unit for them. We have a two-bedroom, two bath, 749. That's the thing for your buck unit.
It has a nice shared living area in the middle, bedroom off to the left with a bathroom, bedroom off to the right with a bathroom. You don't have the entitlement fees because you're under 750 square feet. And it's just a really efficient model, have big, nice 14, 15-foot ceilings in there.
Then we have a 900 square foot, which used to be the max in San Jose. Of course, we got that permitted. They changed it to 1,000.
So we're not quite- Wait, there's 1,000 now? Thousands of max in San Jose. Yeah.
And you could also do two stories. But let me finish that. Wow.
[Stephen Husted] (13:05 - 13:05)
Okay.
[Adam Mayberry] (13:08 - 14:35)
Because with our product, we'd be able to get you a permit within a week of scheduling the appointment with the city. So we schedule an appointment Tuesdays or the appointment windows. Once we schedule that, we can have it reviewed and approved that next week.
The limiting factor is typically two things. One, getting a hydrant flow letter from the city of San Jose, the San Jose Water Company, just to know what the nearest hydrant is, location, and flow rate to make sure it meets the threshold of the fire department needs for fighting a fire if there's a fire there. That's typically 10 to 15 business days to get that letter given their backup at the water company.
If you're in a special water district, you need to get that from whatever that water district is. So if there's any clients out there that are interested, shoot them a message, get the hydrant flow letter ahead of time. The other one is, yes, sign a contract, getting a floor plan done.
We can get the floor plan, site plan created in a few days once we know exactly where that's going to fit. We upload the drawings to the city, say they're here, set us a quickest appointment, and we can have a permit turned around in a couple days, about a week.
[Stephen Husted] (14:36 - 14:37)
Do you need to get a survey done?
[Adam Mayberry] (14:38 - 16:07)
It's not required. We typically want a survey created if you want it really tight to the property line, three feet or less, because if you build over that setback or over that property line without knowing, you're going to be in trouble. So either if you're a builder and have a surveyor that will come stake lines for you, you don't need a survey, or if you require your contractor to have a surveyor stake the lines out.
Site plan could typically be a diagram, but if they don't have the survey, and if there's utility easements, we want to know. So getting a hyperlinked title report from your title company is important for that as well. We want to figure out if there's any easements or covenants that we didn't know.
We've had a steward line go in, it was actually a storm drain going through the rear of someone's property in Redwood City, and that was a garage that was built on the property line. So the easement was going underneath the property, underneath the garage, which we didn't know. So rebuilding the garage in its place was an issue.
We figured it out, but not the easiest circumstance to come up with last minute.
[Stephen Husted] (16:07 - 16:15)
You had to figure out how to get around the sewer line in the ground, right, and being able to run your own plumbing. Is that what was the issue?
[Adam Mayberry] (16:16 - 16:23)
Well, the issue was that we weren't supposed to build in the easement, which we already had a building that we were converting.
[Stephen Husted] (16:23 - 16:24)
It was already there.
[Adam Mayberry] (16:24 - 17:20)
Yeah, and the client wanted us to redo the roof to make it taller to add a loft. Very nice when it got done. So we just had to work with our engineer and the public works department to make sure that we weren't putting any pressure on that sewer storm drain, because any pressure building could burst it.
So we decided to show a diagram of how it was off and get a real location of where the pipe was, and it took a few rounds. Sometimes these departments aren't very clear as to what the requirement is or how we can get past the requirement, that you kind of have to ask those questions like, what would give you the okay of us doing this? Right.
Instead of like, oh, we can't, so we're just going to throw our hands up and go.
[Stephen Husted] (17:21 - 18:00)
Do you think that because you've done all this legwork, so to speak, for a few years on this, that your speed to get them done is much quicker than, say, your average contractor that's maybe building one or two of these a year, and that the process for them could potentially take longer? Does that make sense? Or do you think that, what does a homeowner anticipate?
You've talked about the process, but they come to you, they start getting plans together, start figuring out what kind of timeline start to finish will a homeowner expect?
[Adam Mayberry] (18:02 - 19:06)
So our typical custom AD, if we're starting from scratch or designing something for them, we would typically say about eight weeks to design and submit the drawings for permit, and then another three to four months to have the permit in hand, given most of the city's timelines response. It's between 30, 45 days to get the first response. Okay.
Depending on it, it could be longer. And then they also have a queue. From after you have the plan check approval until the actual permit is in your hand, it could also take a few weeks to permit, or a few weeks to a month to have that actually in place.
Because once everything's signed off, then you have a permit technician that has to process the permit. There's like a payment application. Someone has to go and pay it somehow.
All those things take a little time. And I don't think a lot of our clients are aware of that time for just the bureaucratic back and forth needed to have that issued. Yes.
[Stephen Husted] (19:06 - 19:08)
I've heard about it from clients.
[Adam Mayberry] (19:09 - 20:10)
Yeah. We can design and get permit documents in pretty fast. It's just about timing when we start the work, given our workload, the response rate from a client, and then seeing something and second guessing it and changing it.
And that back and forth is what takes the full kind of eight weeks from us. And we also have consultants that take a few weeks to get to us. So I guess if there's any potential clients out there, think about, and if you're worried about the speed, understanding what you'd like to achieve and what those goals are and how we can help you create those goals on paper will speed the process up.
Because I know a lot of your listeners are probably looking at investment. And even our clients that aren't looking at investment, they are looking at the future on what something will be worth and how sellable that will be if and when they do decide to sell a home.
[Stephen Husted] (20:10 - 20:34)
Yes, definitely. I mean, there's a lot of different nuances to the whole process of getting it done and what you can achieve in the very beginning will help dictate how fast the speed is from start to finish. Would you say start to finish would be anywhere between eight to 12 months?
Does that sound in line?
[Adam Mayberry] (20:34 - 21:29)
12 months should be from contract signed to keys. To keys. That makes sense.
That should be it. We could shrink that down to closer to probably, I don't want to say five months, five to six months for our pre-designed units. If we're able to build ourselves.
We think we have some ways to do that. We're getting those numbers in place to have that available. We do have some numbers about ready.
But say you have a signed contract, we can have a permit to you within two weeks. That gives us a good runway to be able to have a permit or building created within three to four months.
[Stephen Husted] (21:31 - 22:09)
Because you're cutting out the back and forth, so to speak, because it's a pre-planned. Yeah. Okay.
So besides the ADUs, I know that you're doing way more than just ADUs from what I've seen. So in the Bay Area, San Jose, Silicon Valley, what are the other cool new developments that people are asking for? What are they doing with their large lots on the corner?
Because now we have a lot of different things that we can pull off on lots that we weren't able to do years prior. So what have you been up to there?
[Adam Mayberry] (22:10 - 26:05)
Yeah. A lot of AB2011, a lot of builder's remedy, bonus density, and ADUs all thrown in there. I think – so AB2011 is the by right building a multifamily within commercial zones on large corridors.
So your West San Carlos is Monterey Road, areas of cities that are zoned commercial that are almost impossible not to go into how city budgets work. But that's their tax basis land. And you're able to build multifamily there by right, state rules.
So the caveat is that you need to have an affordable component there. I think it's 15 percent low income. You also have prevailing wage, which is a more expensive rate in which you pay the people working on your projects.
But I think at the end of the day, depending on what your land value is, there's things you could do to make that start to pencil. We're still working on a couple of those out off Saratoga Avenue and – I forgot the other street. But we're working on a couple of multifamily projects there.
But what you're able to do is have at least 30 dwellings per acre zone at a minimum. You're able to stack the state density bonus, which adds another 50 percent capacity to the density that the lot allows. So if you allowed 100 units on the lot, you're able to get 150 if you provide a certain threshold of affordable units.
So it's 15 percent. So if you use 100, if out of 100 units, 15 of those are affordable, you're able to get a 50 percent bump. So out of 150 units, you have 15 affordable, you have 135 market rate units versus the underlying zoning is just allowing 100 market rate units.
So you get 35 extra market rate units by building in the 15 affordable. You also get to pierce the height requirement. You get three concessions.
You could say no open space, which if you don't have it on your lot, there's in lieu fees and things like that. So there's a lot of advantage to that. And there's also the ADU law.
And the ADU law gives you 25 percent of the units can be ADUs if converted non non-buildable space. So that let's go back to 150 units now. If you have 150 unit building, but you also have a bunch of space for business center or gym or whatever you want to call it, you can get another 37.5. So 37 units out of that. So now you have 187 apartments, 37 of those you call an ADU, but it's the same exact thing as across the hall. Wow.
[Stephen Husted] (26:08 - 26:08)
That's interesting.
[Adam Mayberry] (26:09 - 26:13)
So you also get two detached units. So it's actually 139.
[Stephen Husted] (26:14 - 26:15)
What are they doing on the detached units?
[Adam Mayberry] (26:16 - 27:52)
Well, what are the two detached ADUs? Wow. If you just have them off to the side, if you have a big lot, again, how you fit it in, I'm not completely sure how big the lot is, but we ran up against this sort of thing on a project we were building in San Jose.
And this is a pretty good example. We'd have to go through a PD zoning process, which is planning commission, city council, create our own zoning because the city didn't have the underlying zoning that would fit. And since going into that, we added the density bonus.
We added some affordable units. We reduced our fees for the in lieu fees, which is going to be a million plus dollars in fees. We are able to reduce the base of the building to be satisfying the underlying zoning, which is just a site development permit.
So no discretionary hearings now. We're able to get the same amount of units and a bonus. We're able to use the waiver for height, making it taller.
So we were only able to do 35 feet with the underlying zoning, but this building is going up to 70 feet tall because of that. We're also able to reduce the parking. This client actually did not reduce the parking.
They still have like two units, two spaces per unit.
[Stephen Husted] (27:52 - 27:59)
What type of clients do you have coming to you? Tell me your client pool. Is it the homeowner to the built?
Break that down.
[Adam Mayberry] (28:00 - 29:20)
We're probably 50% homeowners and 50% investors. It's probably 35% percent sort of hobby investors, someone that has a couple extra properties that they've invested their money to diversify portfolio that I, this rental house, can we do an addition here plus an ADU or just an ADU and I'm going to rent them out, those type of clients. And then the other 15 are investor, like developer types that are actually doing these projects.
Yeah. That's their main work, whether they're a builder that are doing it for themselves or someone that has equity stake in development, but we're small and nimble and we're not all those descriptions, but we're not a big established firm with a bunch of people in desk. And I think the larger developers don't view us as a viable option for being able to execute a project that I've done enough.
[Stephen Husted] (29:21 - 29:39)
Yeah. I've seen your projects online. They're super cool.
I like the styles of them. I think there was one in Santa Clara that you did that was a lot and then you turned it into two townhouses and was very farmhouse style, really modern farmhouse. That was really cool.
[Adam Mayberry] (29:39 - 30:27)
Yeah. The Myrtle project, that was the development we developed. It's actually in San Jose.
It's very close to Santa Clara University, but it's probably 10 doors down from the city limits. We are actually doing something similar to duplex plus two ADUs on the border. This is the last vacant lot.
The neighbor to the north is Santa Clara, which is funny because half of the surrounding area, when you go to notified neighbors of a new development to come talk and say what they don't like about it, half of them was a different city. They didn't even have any jurisdiction over it. No one really chimed in on this development.
[Stephen Husted] (30:27 - 30:54)
Let's go into this about notice of developments. When those signs go up and they're everywhere, how much does the public really have in the say of what's going to go on with that development? Are they just there to vet their concerns and then the builder can take some of it in consideration?
What are those hearings for?
[Adam Mayberry] (30:56 - 33:22)
Yeah. Well, to educate the crowd here, they're to have neighborhood buy-in on the project and to give feedback on things that may or may not be appropriate for the neighborhood in an effort to make it the community more well-designed and thoughtful. Typically, the comments you get are how those projects will be perceived to negatively affect those individual people, not necessarily for the greater good of the community.
We had a standing metal roof on our duplex project. I don't see a lot of people complain, but I know that someone in the neighborhood definitely said, well, there's no one else with metal roofs on this neighborhood. So, I don't know if that's appropriate, but it's a nice expensive roof and you see a lot of custom homes all over the Bay Area with that kind of farmhouse metal roof.
It's a much higher end roof, Palo Alto, and there's just a lot of those neighborhoods. And to be frank, this neighborhood used to probably be an orchard that had metal barn units and garages and stuff with a similar roof that used to be utilitarian, agrarian building type material. And so, we ended up talking with this particular person, and I think they came to the conclusion it was a matter of opinion and it didn't really look that bad and they could have it.
But I think some of those voices give a little bit too much weight to the process because it's at the discretion of the planner to field those comments and make a judgment as to what's relevant or not relevant.
[Stephen Husted] (33:24 - 34:31)
Yeah, especially when they're not developers or architects, it's sometimes hard. I think it's just more of an emotional comment and artistically as well, pointing out a metal roof. And I know what you're saying because I ride throughout Las Gadas and those metal farmhouse roofs are popping up.
And they're popping up in some of these neighborhoods that are more of the Victorian style homes. But now some of these neighborhoods are going, there's a lot of mixture because there's old homes and people want different styles now. And so, now you're getting a mixture of so many different types of homes.
And you know what? They all blend in very well. And honestly, I think the metal roof look, not that I would want the whole street to look like done, that'd probably be impossible.
But when you do see it, it almost looks fresh and newer. And it feels like it would probably bring up the property values in that location because it's a brand new build.
[Adam Mayberry] (34:32 - 35:13)
Yeah, that's correct. And yeah, there's a lot to comment on. You know that when you have new homes in your neighborhood, there are new opportunities for people to start setting a market.
So, when people are buying multiple smaller units, there's more people. It's bad because they're adding more people and more parking, all those things that negatively affect people's lives.
[Stephen Husted] (35:13 - 35:27)
But that's a big topic right now. Metal roofs and high density in a single family neighborhood is not perceived well in a lot of locations. I guess that's what I would say.
[Adam Mayberry] (35:27 - 37:10)
Yeah, it's true. But regulated housing is good, I think. And having rules around it and be able to buy small units is very good for those people that are trying to house their kids in their backyard.
I don't think parents necessarily, ideally want their kids in their backyard. And I don't think those kids want to be living the first time out on their own after college living in a backyard. If they could buy a home half mile away in someone else's backyard, that's 800 square feet and actually a starter home, it'll be awesome.
So, the issue is if we don't have these homes, then you have large homes in these neighborhoods converted to dorms. And you have eight people individually living there with eight different cars. Nothing's regulating that from happening.
You can do it everywhere, right? So, adding an AD or having a duplex plus two ADUs on a single family lot, well-regulated with nice off-street parking, it benefits the neighborhood and adds people that own homes. And it's new, they're going to be paying a premium to live there.
I think it benefits neighborhoods. So, you can be a little bit more open arms with allowing people to live in your neighborhood. Because most likely, they're going to be a young family if done well.
Let me go back to your other question about design and neighborhoods.
[Stephen Husted] (37:10 - 38:23)
One second. I wanted to tell you something because you just brought up an amazing point that I didn't even really think about. So, this whole lot split and building duplexes, I remember when that was coming out that there was a lot of agents in Willow Glen that were talking about that were really upset.
But you brought up a really good point. You're not stopping anyone from buying a single family home that's a five-bedroom and renting out the rooms individually and having essentially five cars in that neighborhood. That's a big point right there.
And I know that's popular in like Palo Alto, up Mountain View location. They're doing that already to house startups or tech workers that want to work to get five individuals. So, that model is already out there.
So, all it would take, because it's completely legal, what happened if three houses on one street in Willow Glen had that situation? Now they got 15 cars essentially on that street. So, you bring up a really good point.
I didn't even think about that. That's a great point.
[Adam Mayberry] (38:25 - 42:21)
I think putting yourself in the shoes of those people that may be living there or maybe building or designing it. I think as a homeowner, I'm sure everyone now in the Bay Area, Northern California in general, has some kind of perspective on negative effects of the housing crisis. I'm sure they have someone in their life that is not able to find an appropriate place for a price they can afford.
Whether you're trying to buy a house or trying to rent your first place as a young married couple or something. It's really hard. It really does negative effect your livelihood.
So, I think we need a lot more open solutions to be able to come to a conclusion. I'll use ADUs as an example of this because I think we need a lot more of it with other state law and local jurisdictions. When ADU policy first started in San Jose, they were very marginally easier than previous zoning.
San Jose's had an ADU law maybe since the mid-90s. It's just really hard to get the ADU built. So, they made it easier.
I have a couple of issues with because when I'm designing, I'm getting everyone to say, hey, how about my lot? How do you do it? Then I look and say, yeah, this one rule really makes it hard for you.
So, I told the city we're going to have stakeholder meetings and we're going to update the ordinance. Those neighborhood group meetings where the neighbors would give feedback, they were just chock full of people there saying, I tried to do this at my yard and I can't and I want to. That's what led the city of San Jose to say, we have the political will here of the neighbors and the neighborhoods to get this to pass and be really flexible.
So, allowing two stories, not slim, but bigger footprints, 1,000 square feet, all that stuff is all because the citizens of the city of San Jose forced them to allow it to happen. We have a lot of property, a lot of empty nesters, boomers that have their backyards going to waste. Not a lot of people at home anymore.
We could be our retirement income and we could travel the world and do what we could live in the ADU. We're now going to build our own home. We've never built a home.
We could customize it to the little things we like and we don't need that much space, the two bedroom and we'll rent out the main house and travel. So, they wanted it, right? Similar with SB9 duplex slot split.
I think if you're a homeowner and you have a property that you have very minimal down payment or minimal mortgage payment or no mortgage payment, you're at a huge advantage. The way it's written, you're in the driver's seat for developing that property.
[Stephen Husted] (42:22 - 42:27)
There's regulation to it, right? You have to actually be living there, right?
[Adam Mayberry] (42:28 - 42:30)
You have to intend to live in one of the units.
[Stephen Husted] (42:31 - 42:49)
So, it's great for somebody who has a nice lot, corner lot that has enough in their backyard to build it. You lot split it. You don't have a mortgage and you could basically go to any bank and get a construction loan to pretty much get it done.
Right.
[Adam Mayberry] (42:49 - 43:53)
There's no title issue with your lender because you may not have a loan. You could also demolish the house. You don't even need to do the lot split if you want to keep it.
So, let's just play the scenario out. You're a homeowner. Like I said, retired couple ready to travel the world or just not be so tied to their property taxes or whatnot.
We could build an ADU for you in the back. You could move into it. We could tear the main house down, build two units that are similar, three bedroom, two baths or whatnot, depending on how large your property is.
There'd be two brand new rentals that would probably go for, we're talking about San Jose or Willow Glen, $4,000 plus a month, $5,000 a month. And they could build another ADU next to yours and get another $3,000 or so a month.
[Stephen Husted] (43:54 - 44:07)
So, wait, wait. How many, with that process, let's walk through this one. What size lot are we talking?
And you said you basically would build two duplexes.
[Adam Mayberry] (44:08 - 44:09)
Yeah, one duplex.
[Stephen Husted] (44:09 - 44:11)
You build an ADU at first and live in the ADU.
[Adam Mayberry] (44:11 - 44:13)
One duplex, two units. Yeah.
[Stephen Husted] (44:13 - 44:25)
One duplex, two units. Okay. So, just one duplex, two units.
Got it. Okay. And then you have the ADU.
You'd live in that during the construction part, correct?
[Adam Mayberry] (44:25 - 44:26)
Right.
[Stephen Husted] (44:26 - 44:26)
Okay.
[Adam Mayberry] (44:27 - 44:39)
So, then you wouldn't have to be displaced. So, if you build something in the back, you'd live there while they demo the house. There's a lot of older ranch houses on big lots in Willow Glen that they could be even nice.
[Stephen Husted] (44:39 - 44:42)
What's the minimum? What's the minimum you would need?
[Adam Mayberry] (44:42 - 45:08)
So, technically, 3,500 square foot lot. What? That's really tiny.
Yeah, that's right. Yeah. You can do it on 3,500 square feet.
Imagine 800 square foot floor plan and adding a second story on top of that with a stair going up to it. That's a 2,800 square foot duplex you can do.
[Stephen Husted] (45:08 - 45:09)
Right. Okay.
[Adam Mayberry] (45:11 - 45:12)
Yeah. Wow.
[Stephen Husted] (45:12 - 45:13)
That's just...
[Adam Mayberry] (45:13 - 45:13)
It's kind of, yeah. Yeah.
[Stephen Husted] (45:14 - 45:21)
And all the regulation for this has laxed, so to speak, when building these.
[Adam Mayberry] (45:23 - 46:18)
Yeah. So, with the SB9 policy, there's a lot of gray area in the way it was written. So, they leave it up to the jurisdiction.
There's no watchdog like HCD, housing community development at the state level to say, you can't do that, or you have to do this. They can for ADUs, but not the duplex or lot split portion of SB9. So, it's up to the city.
San Jose has a very good checklist. I still think there's things that need to be changed to make it easier, even for homeowners and not just the developer types. And there's a cleanup bill coming from the state.
I'm hoping that's decided. I don't know. I haven't checked in lately where that's at, but make it more direct and have HCD give them the budget needed to have people make sure jurisdictions are doing what they're supposed to.
[Stephen Husted] (46:19 - 46:57)
Yeah. It's crazy what you really can... It really comes down to, when you're thinking of a project, at the end of the day, you want to just reach out to an expert and let them give you your options.
That's the biggest part of it. Don't try to guess what you can do with your house or your lot. Reach out to somebody and start getting some options, and then you can see what really works for you.
Because that 3,500 square feet lot, that's crazy when you put that in perspective. I was like, oh my God, that's amazing. You could really call that off.
[Adam Mayberry] (46:57 - 47:38)
Here's a good example of this. We're working with a client now that a builder sent to us, and they're like, okay, they want to add an ADU. They're going to add a 750 square foot ADU.
In our meeting today, we're like, well, the main house is actually a duplex, which means they could do two ADUs. Do they know they could do two ADUs? This is an investment property.
Instead of one 750 square foot, they could get two 530 square feet or something. Do they know that? No, because they came to us saying this is what they want.
We didn't go through that process of saying what the value is.
[Stephen Husted] (47:39 - 47:43)
What's the best use case for this property and this land?
[Adam Mayberry] (47:43 - 51:13)
Right. Coming to someone like myself that is really thinking for you through this is great. Not that you can't do it and you can't do your own research, but we do have most people that come to us like, okay, I've been on the blogs and the YouTube and the city's website.
I've gone to seminars and talk about ADUs, but they don't know all those opportunities that your property may have. You might live on a residential block that's actually in a commercial zone that you could then now get five units. If you get over five units, that turns into 13 units pretty quickly using the things I talked about.
As simple as they've made it for ADUs, I would still advise talking to us. We have a couple of programs that you're able to utilize with our firm that we're rolling out here. There's a $100 program.
You sign up, pay $100. You follow our project questionnaire, be very specific on what you're looking to achieve. This is an investment.
This is for a friend or just for family to live in, or what can I do here? And we'll send you a 10 minute video plus site plan and ideas on how to maximize the potential of that property. Very quick and easy, but we could run through all those options for you.
There's also a $400 option. We'll do something similar, but we also get a full hour, just like we're taking today. I could talk through all the scenarios, do this custom site plan diagram of what you can do.
One of our clients who's a builder investor came with us. I just purchased this property. It's a smaller house, decent sized lot.
I'm probably going to ADU, but can you take a look at it for me? Where was this at? I think Hayward or Concord.
I get those two confused because I have a couple of clients that have properties in Hayward and Concord. I think it's actually Concord within a half mile of BART, which is a huge plus because there's a lot of zoning and transit incentives you get for being close to BART, which is a high frequency transit hub. It's also in a multi-family zone, so you can do the math.
They can actually get six units on this property. It's a single family, it's a house. Like I said, six units, 15%.
If you have one affordable unit, that six unit translates into nine market rate with a bonus density. So nine market rate units, and then if you add 25% of that, that's two more for ADU, so we can convert the garages that we make into ADUs. How big was this lot too, by the way?
11 units. How big is this lot?
[Stephen Husted] (51:14 - 51:16)
I'm so focused on the lot sizes.
[Adam Mayberry] (51:17 - 51:24)
I think it's less than 10,000 square feet. I think it's 8,000. I can find out for you, but yeah, I think it's an 8,000 square foot lot.
[Stephen Husted] (51:25 - 51:28)
And wait, and this is essentially a residential neighborhood?
[Adam Mayberry] (51:31 - 52:08)
It's in a multi-family neighborhood. It's a residential neighborhood that there's BART, and it's near to the downtown. You think of the Nagley Park neighborhood in San Jose, just east of...
It's a historic neighborhood, so they wouldn't do this, but those neighborhoods should have a density of 30 to 40 dwellings per acre. So we're going to target 13 units there, 11 unit building, and two detached units, no parking.
[Stephen Husted] (52:10 - 52:12)
How much was this? Did you know how much he paid?
[Adam Mayberry] (52:14 - 52:48)
I don't know. I think it's one of those properties, probably like a lot of your investors that follow you and listen, that they have a property they've been working up for years, and it became available. Finally, that person said, yeah, we'll sell it.
We're tired of dealing with tenants. One of those type of properties. So I don't know what he paid.
I don't even know if it was advertised. I think he just had an agreement with them and got it. So he could be in for 700K or less, which...
[Stephen Husted] (52:48 - 52:49)
That's a phenomenal...
[Adam Mayberry] (52:49 - 53:00)
I mean, anywhere in the Bay Area, that's less than 55,000 per door, which even in title property, you could probably sell for 200K a door.
[Stephen Husted] (53:03 - 53:06)
It's like the light bulb moment you're giving me right now, Adam.
[Adam Mayberry] (53:07 - 53:11)
Yeah, I mean, those are the things that we try to help our clients with.
[Stephen Husted] (53:12 - 55:25)
You know what's interesting, Adam, when you bring that up? I just closed on a property in Kansas City, and it's right over by KU Med, and it's a duplex. It used to be a big estate, and now it's duplex.
So it's a 2-1, so it's top-bottom. 2-1 on top, bottom is a 3-2. It's a corner lot.
It's 8,000 square feet. It's got a huge backyard. And then on one of the side streets, it's got a detached garage that basically you pull into the garage and you access the garage, and you can basically go upstairs to the 3-2 on the main floor.
And so I saw the garage, and one, I just ended up woke up one morning. I said, I'm going to call the planning department. So I called Kansas City planning department and said, hey, I just bought this property.
What can I do? I want to utilize this property the most I possibly can. And she's like, well, you got a detached garage.
You could probably build an ADU on top of that. I'm like, great. This sounds great.
What else can I do? Can I lot split? Can I build something else?
She's like, you can build one over the garage, and that's about it. I'm like, okay, can I make the garage a four-car garage? Because parking's really tight over there.
I could rent out some of the spots because of all the students. There's not a lot of parking, let's just say that. So I went in like, okay, well, can we build a four-car garage?
Can I pave the backyard and put a couple storage lockers? Because I know that people need that in the location. So now I'm like, what is the...
And all I did was just ask questions. And later today, I'm getting on the phone. I'm doing another Riverside actually with an architect out there.
And I'm just going to start buying things and looking at properties and just passing it to them. What is the best use case? What would really add value here, bring housing?
What's the best I can do on it? And I think that's the big key is you just have to ask questions. That's really what it comes out to.
Instead of assuming what you think can be done.
[Adam Mayberry] (55:25 - 56:51)
Yeah. Ask questions and then clarify those answers when it comes to design. We're constantly checking back.
And that's one of the things I was going to mention with, we're talking about call your architect, have an architect. And not just someone that can get you a permit for the lowest price, because there's some value in paying upfront for the design and the value. But even though you've done all the research, we're going to do that research again to verify.
We can't just say, well, you said this, so we did it. And now they say we can't permit this. We need to do that ourselves and go through.
We can't get everything every time. And the rules are constantly changing and evolving as well. And we know even rules on the checklists that we don't need to comply with because the city has not had time to update their checklist or we know that out of compliance and we've pushed them on it and got the state to overrule their city attorney's office.
So I mean, it doesn't have to be us. Hire an architect that has experience in representing you. We're like an attorney from a three-dimensional attorney.
[Stephen Husted] (56:52 - 56:53)
He has a good way to look at it.
[Adam Mayberry] (56:54 - 57:01)
We're going to be finding value in space you didn't know existed.
[Stephen Husted] (57:01 - 57:17)
Hire the expert, just hire the expert. So I want to switch gears a little bit because I didn't know this in the beginning until I went on your website. Can you give me the history of the name Mayberry Workshop and where that came from?
[Adam Mayberry] (57:19 - 59:25)
Yeah. So it's kind of funny. I've always thought of having my own practice and not necessarily as an architect, but as someone creating housing.
I don't know why housing, but I just like the ability of creating space for people and wanting to build them ourselves. Not necessarily I'm an architect, traditional architect, but the ability to work in the build process and the development side and just thinking through the name of my firm type things, playing this. There's always the Mayberry architect or Mayberry studio or Mayberry design or something like that.
And I came across this photo of my great-grandfather's woodshop. My family was actually up until my grandfather were carpenters and builders on the East Coast out in Boston area, multiple generations of builders and carpenters. And I saw this workshop with Mayberry name on it.
I think there's a picture on our website. I saw that. Yeah.
And so I was like, workshop, it's kind of a vague name for tinkering and creating. I think that plays into what we do. We kind of create and workshop ideas for you and create value.
And we could be Mayberry workshop as a builder, or we could be Mayberry workshop as an architect or even a developer. Legally, we're not a builder. We don't have a general contractual license, but we do have partners we work with on that side.
So yeah, it really came out of that picture, Mayberry workshop and my great-grandfather's workshop. That's pretty cool. Bolton, Massachusetts.
That's great.
[Stephen Husted] (59:25 - 59:27)
You came from builder family too.
[Adam Mayberry] (59:27 - 59:27)
That's awesome.
[Stephen Husted] (59:27 - 59:30)
I mean, that really shows it's in your blood.
[Adam Mayberry] (59:31 - 1:00:31)
It's generational. It kind of is. I actually wasn't exposed to anything like that.
It just kind of happened in me. So I think it might've been actually some kind of genetic passing down of wanting to be outside and building stuff. But my grandfather, who I actually did not ever meet, he passed away before I was born, but he was an engineer and a tinker and built stuff.
But he has... I'll have to do a post on it. There's a little toy kit he created of a home, almost like a little ADU.
And it's in a little... He created a box and created the branding marketing and a little guide to how you frame it using little balsa wood pieces. And they're all pre-cut.
And he was trying to create this as a toy product that you'd sell to kids to make them. And it's really cool. I'll have to get a couple of pictures of it.
[Stephen Husted] (1:00:32 - 1:00:43)
That's really cool. You know what's funny? So my brother, I don't know.
I probably told you this. My brother used to be a general contractor, but now he's a city inspector for Sunnyvale. But I guess he was over at...
[Adam Mayberry] (1:00:43 - 1:00:43)
Did you know?
[Stephen Husted] (1:00:44 - 1:02:18)
Yeah, yeah. He let me know where he's at now. He's trying to get in with San Jose too.
Well, I think he's trying to interview there or maybe. But he was doing work over at my parents' house and they have a den. And I guess he was cleaning out something in the top in the rafters.
And he came, he goes, dude, I just found all your work from when you were doing drafting in like seventh grade. And all these houses you were building and these... He's like, these drawings are amazing.
He's like, this is really cool. And I told him, I go, that was one of my favorite classes. Here's what's crazy.
The drafting class was one of my favorites. The other was TV journalism. And in that TV journalism, what I do remember is we had our final assignment where we had to shoot a commercial.
And I did it back then I was into heavy metal. And so I'm like, all right, I'm gonna do it on heavy metal. And I hired a couple students to dress up in heavy metal gear.
And I did this whole thing. And now you fast forward to now, and I'm in my 50s. And those two things from junior, middle school are coming to play now.
It's the most strangest thing. I mean, I don't know. Architect is, it looks really cool.
But is it more of an engineer? Do you have to have more of an engineer background? What does an architect have to do for schooling?
[Adam Mayberry] (1:02:20 - 1:04:14)
Yeah, depending on what school you go to. There's a lot of math. I think a lot of people get dissuaded by the math.
But it's probably one of the most well rounded majors or the most things. So from like, I went to Cal Poly, from a general education requirement perspective, we have the most general education classes required. And the most major classes required.
I think we might be the only five year degree at Cal Poly. That's not a four plus two or four plus one type master's program. But yeah, a lot of math, we took engineering, calculus based engineering, six quarters of that, of architectural engineering classes.
And yeah, a lot of design thinking. It's and problems spatially to solve them. And that could be graphic design, how to diagram something, how to create packaging, or home, or how to, how to like, critically think through code or issues that people come with.
I have a home right now, we're working on. And I've been working on it for about, it's what, August? Yeah, like, or September, probably eight or nine months, back and forth about how to meet the fire requirements for an addition on a 10,000 square foot house.
And we're just not getting to a conclusion. This is a county, it's Santa Clara County.
[Stephen Husted] (1:04:14 - 1:04:15)
Santa Clara County.
[Adam Mayberry] (1:04:15 - 1:05:21)
It's rural, and there's like fire. It's all about protection, you know, in the event of something going wrong. But we didn't want to put fire sprinklers throughout a 10,000 square, or an existing 8,000 square foot house to get a 1,000 square foot addition.
So we're like, testing hydrant. There's another hydrant, so testing both hydrants at the same time to see if we got the flow correct. It's a private water, so it's, there's a lot to it.
But I'm constantly thinking through how can we get this done without having to totally disrupt this family's life in the house and kick them out for a week or two. At the end of the day, it might be the quickest, easiest solution. But it's just money and effort that we're telling them to just pay more and move out for a while.
It's, that's not what we're trying to do. We're trying to get it done cheaper and outside, modifying the house. So, you know, there's always things like that.
Like I said, thinking through code and opportunities that aren't specific.
[Stephen Husted] (1:05:22 - 1:05:35)
What, who, break down who's on your team. So when somebody comes to hire you, who is on your team that's working on behalf of the clients?
[Adam Mayberry] (1:05:39 - 1:07:31)
Yeah, I mean, we have, you know, I have project managers and architects, designers, all architecturally trained. We have an admin staff that help with communications, but we have multiple engineers, multiple structural engineers, multiple landscape architects, multiple soils engineers, surveyors, and civil engineers. We typically like to have one contract with the client and we manage everything else.
So when payment comes to us and we distribute to our consultants, that way we can control them and make sure they're doing what they're supposed to. You know, sometimes that's not always in our best interest because we can't physically force them to do those calculations or designs, but sort of the risk we're taking. But, you know, we have older people that don't work anymore that we call and ask advice on or how would I deal with this?
We have younger up and coming structural engineers that are going to practice and it's easy for them to just get over to a property and take a look. Whereas, you know, some of the older, more established firms like pretty busy until next week. So we're able to mold how we do things.
And again, you know, sometimes it's like, let's just wait till next week. At the end of the day, it's not going to save us time and it may save you money in the long run because it's not going to take you months. This person will get it done and do it right the first time.
So, you know, we had those discussions with our clients and who were hiring on their behalf and they can help make the decision with us.
[Stephen Husted] (1:07:32 - 1:09:30)
Yeah. I've been working with an architect right now on a new development in Willow Glen that we're going to do. It's just, we're adding square feet and I met with them and I go, you know, okay, here's my vision.
And I just wanted to know that how I was thinking it was going to be in line with what he was going to be, you know, put into the computer and see what he came up with. And 50% of it was accurate. But then it was funny, the other part of it of where he, you know, rearranged bedrooms in the front of the house.
I was like, oh my gosh, that looks, that's amazing. You know, like I didn't think of that, but just how he took the space and changed it. And it wasn't a dramatic change.
It was just moving bedrooms from one left side to the front of the house. But, you know, it was just crazy. It's just a very intriguing, I probably could never be an architect as the fact that I'm not the greatest at math.
I'm not an engineer brain whatsoever. I think I'm more of a kind of a visionary creative type that would just like bounce an idea off you and then run with it and pick out, you know, fixtures and tile and things like that at the end and feel good about it. But I really, it's just, I really, I really love the whole process of it, you know, and I'm learning more about it right now.
And it's kind of where for me moving forward, I think this is the direct direction I'm going to be going is more development because I just love that. I've been, I think once I started doing, you know, flips and, you know, building out houses that are all in distress and taking them there, this is just the natural progression now moving forward. I noticed that.
And yeah, so it's been really great picking your brain and getting to hear what you do. I mean, we've talked a lot, but it's just good to hear a little bit more in depth. But if so with the audience, where can they find you?
[Adam Mayberry] (1:09:32 - 1:10:01)
Yeah, you can find me at mayberryworkshop.com. We'll give you a link that will go straight to those kind of two scenarios I said for the best way to evaluate your property. That will get your foot in the door and get us all the information we need to help evaluate the property.
And from there, you're kind of in our system to help get that value for the property.
[Stephen Husted] (1:10:02 - 1:10:07)
We'll link it in this episode as well. I'll put your Instagram in there too if you want people to follow you.
[Adam Mayberry] (1:10:08 - 1:10:32)
Yeah, at Mayberry Workshop on Instagram. We've been on a lull on the social media while we're getting other things worked out with office space and employee sort of development. But we're going to get in a more flow of kind of creating value and content for people as well.
[Stephen Husted] (1:10:34 - 1:10:55)
You've got cool stuff on there already and I'd love to see some of your projects in real time and video. I think it'd be great. Especially people love to see that.
They love to see something starting from the beginning and getting finished. I think it's just huge. Gives them a visual too of what they can do with theirs.
[Adam Mayberry] (1:10:57 - 1:11:22)
Absolutely. We got to set the deadline. You got to set the appointment to post stuff.
But we're solely focused right now on getting clients work out the door and permitted built for them. So, I've been spending a lot of my time doing that. And we'll be delegating some of the social media stuff.
[Stephen Husted] (1:11:23 - 1:11:36)
Sounds like a plan. Yeah. Good.
Well, thank you, Adam, for spending an hour with me and chatting. I appreciate it. I know we were trying for weeks here, but I'm glad we finally got it done.
[Adam Mayberry] (1:11:37 - 1:12:10)
Yeah, it's great. Great to chat. I love being able to explain these things and opportunities for people because I think I could say confidently, I'm a unique type that is really trained as the development side of architecture and have geared most of my career towards that.
So, I just need to get out there and explain more of that value to potential clients and customers.
[Stephen Husted] (1:12:11 - 1:12:35)
Well, thank you. I appreciate it once again. And yeah, we'll get this rolling and we'll get all your links in there.
Hopefully, some people could reach out and be inspired from what you're saying to look into what they can do with their lot, especially now that I know that I had some light bulb moments with you, just the 3,500 square foot. I'm like, oh, gosh, just build up. That's great.
So, I appreciate it.
[Adam Mayberry] (1:12:35 - 1:12:43)
That's kind of tight though. Legally, you can't, but it's tight. 8,000 corner lot, 10,000 corner lot is nice.
That's a nice number.
[Stephen Husted] (1:12:43 - 1:12:48)
You're ready to go. All right. Well, you have a great day and we'll be talking to you soon.
